London Update; what is Ethereum’s new Update? Features and risks
what is Ethereum’s new Update: Ethereum Blockchain’s big and fundamental updates and changes are called “Hardfork”, and if no problem happens to it, the newest update is going to be executed in August 4th. This Hardfork that is called “London Hardfork” contains 5 suggestions to improve Ethereum that each one requires some changes in the coding, to improve and optimize the second biggest cryptocurrency in the world after Bitcoin.
In this article in shetcoiner website, we’re introducing Ethereum’s London Hardfork, its probable features and risks and its importance for crypto society and Ethereum’s fans.
Big and important features in Ethereum’s London Update
Fundamental redesigning in Ethereum network’s fees
One of the most important changes in this Ethereum update that is called EIP 1559, is the fundamental redesigning that is being done on the fees in Ethereum’s network. This change was one of the most controversial changes in Ethereum society that can help a lot in Ethereum’s improvement. In fact; you can say that one of the biggest problems in Ethereum, is its network’s high fee price that makes other Blockchains attractive for traders and investors right now and made it hard for them to use Ethereum’ Blockchain for being hard and costly.
Redesigning the Ethereum’s limitless supply problem
One of the common arguments that is against Ethereum and its bugs and troubles, is its unlimited supply.
Bitcoin has made a limited amount of supplies for itself as the first cryptocurrency in the market that is allowed to supply 21 million units in its network. This feature of Bitcoin is an important part of its reputation as digital gold.
EIP1559 simulations as of June 8th shows that activating the EIP 1559 upgrade over 365 days (1 year) will results in the burning of 2,967,937 Ethereum units, representing a 76% reduction in Ethereum supply growth over that one-year period.
The EIP 1559 update is supposed to improve the waiting time for transactions, in addition to creating conditions and supply constraints and making it as valuable as Bitcoin, and also eliminates the uncertainty in fees that prevents the widespread use of Dapps by developers and users.
Execution the requirement of paying fee in network with Blockchain Native currency
Also, in this large Ethereum Hardfork, the role of ether as a form of payment for the use of Ethereum computing resources and interaction with the extensive Dapps system is to be emphasized by requiring the payment of transaction fees only in the local currency of the network.
Ethereum’s London Hardfork (EIP 1559) risks
Encrypted currency network updates are usually high-risk operations and can cause new cryptocurrencies to fork out of the original cryptocurrency in the event of a problem. The most important risk that EIP 1559 is that it can carry is related to the proposed changes to the system and reduce the rewards and payments to Ethereum Miners.
Income reducing for Ethereum Miners
With the activation of EIP 1559, Ethereum miners will face a reduction in their income and revenue. In fact, miners currently receive 100% of the transaction fee, but after this update, only the additional cost that users confirm to prioritize their transaction. Will receive pay.
This can’t directly affect the processing of blocks or hash rates of the Ethereum’s network. But it is possible that Ethereum miners will leave the network or sabotage it or even form a rival Blockchain.
Lack of high practical efficiency after upgrade
For Dapps developers and users, upgrading EIP 1559 may not be as effective on paper and on schedule. Failure to make the right change in fees can discourage many Ethereum’s users and developers, and if that happens, ethereum could be in bigger trouble, and many users and developers of the Ethereum blockchain network to other competitors. Ethereum, including Binance Smart Chain or Cardano (ADA), will migrate, and this will undoubtedly drastically reduce the market value of Ethereum compared to its competitors.
Measuring the Benefits of the London Update (EIP 1559)
To measure the benefits of EIP 1559 and its impact on users in the long run, Ethereum Investors can consider a number of real transactions in EIP 1559 format as a way to understand if they are practical and useful in practice. You can do this through Etherscan.
doing London update and the instant results after it
The London Update was launched at 12:33 (GMT) on Tuesday, and since then, the Ethereum transaction fee has risen slightly from 0.003 to 0.005 ether. In addition, the block size, measured in the Ethereum network as a Gas unit, is moving toward a predetermined target of 15 million gasses.
At first glance, the Ethereum 1559 improvement plan seems impressive. Some of the commissions are burned and the block volume is dynamically priced so that the average block size reaches the appropriate level. However, a closer look at the plan reveals evidence that the Ethereum 1559 improvement plan may not be as effective as its main goal, which is to make Ethereum fees predictable for network users.
It is also said that this update has not yet affected many blocks and it remains to be seen how this update will affect the Ethereum network. Many users are worried about this update and the temporary increase in network fees, and many more are waiting for the results of this update in the future of this blockchain and cryptocurrency (Ethereum).
